Mixed Use Properties (new lead)

[Darieal S.]

Hello all,

Would like some feedback about these two property leads that came in from 1 owner. A lead comes in from my site for one property, conversation goes into getting 2 for 1 possibly. The problem is, both are total rehabs. Property 1 & 2 are both mixed-use properties

Property One:

• Originally had 3 - 2Bds/1 bath w/ a commercial space on the 1st floor (city site does show it's zoned for mixed use)
• Full Rehab / ARV anywhere between 85k-130k
• Rents being about 850.00 9 2bd/1bath w a commercial space that could be converted to an additional unit.
• Rehab started (Gutted) but nothing else

Property Two:

• Details are pretty much the same, but in a different area of the city.
• Two - 2-3Bed/1 bath w/ commercial area on 1st floor, that could be converted to an additional unit.
• Full Rehab needed (Roof needs to be done)

She is highly motivated! Just want to make it make sense for my end buyer!

So my question would be: (1st time dealing with a property w/ mixed use)

1. How do I account for a full rehab for this property when running the numbers?
2. The area for the 1st property is best suited for tenants having a vehicle although, transportation is available.
3. The cap rate on both would say "walk away" though!

Scheduled a walk through of both for tomorrow, so any input would be helpful.